A libel ruling against the Times by the court of appeal yesterday has dealt a blow to investigative journalism, media lawyers argue.

In a case brought by Gary Flood, a detective sergeant in the Metropolitan Police, who had sued the Times for libel over an article that accused him of "taking bribes", the court of appeal judges said that the newspaper was not entitled to "Reynolds privilege", which offers certain protections to investigative journalists.

Three appeal judges, headed by the master of the rolls, Lord Justice Neuberger, overturned a previous ruling that a newspaper article was covered by the Reynolds privilege.

The court allowed the cross-appeal by Flood, who had sued Times Newspapers Limited, which publishes the Times, in June 2006.

In that case, Mr Justice Tugendhat had ruled that the Times was entitled to rely on the defence of Reynolds qualified privilege in regard to the print article, but that it had lost that privilege on the article on its website after an investigation exonerated Flood.

Reynolds privilege was established as a new defence for libel claims in 2001, for cases when the story is deemed to be in the public interest and the publisher is held to have acted responsibly. It is designed to protect investigative journalists acting in good faith and reporting on matters of public interest.

Lord Neuberger, England's second most senior judge, yesterday indicated that the mere reporting of allegations was not covered by Reynolds.

He said: "Of course, it will add something to the substance and newsworthiness of the story that the police are investigating the claimant, but it seems to me that it would be tipping the scales too far in favour of the media to hold that not only the name of the claimant, but the details of the allegations against him, can normally be published as part of a story free of any right in the claimant to sue for defamation just because the general subject matter of the story is in the public interest."

The media lawyer Mark Stephens, of Finers Stephens, said: "This is a decision which is so obviously wrong that it needs to be reviewed."

He claimed the ruling called into question "all the developments in terms of Reynolds and neutral reporting", adding: "Clearly it is in the public's interest to know the details of allegations that are being made to the police. It is an extremely troubling judgement."

The court also yesterday dismissed the Times' appeal against Tugendhat's finding that the Reynolds privilege had been lost in relation to continuing online publication, which has implications for newspapers with large online archives.

The Times is planning to petition the supreme court for permission to appeal against yesterday's ruling.

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